SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    FORM 10-Q
(Mark One)
[X] Quarterly  Report Pursuant to Section 13 or 15(d) of the Securities Exchange
    Act of 1934. For the quarterly period ended September 30, 1997.

                                       or

[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
    Act of 1934. For the Transition period from ______________ to _____________.
                                   


Commission File Number: 0-19671

                             LASERSIGHT INCORPORATED
                             -----------------------
             (Exact name of registrant as specified in its charter)

 
        Delaware                                           65-0273162
        --------                                           ----------
(State of Incorporation)                       (IRS Employer Identification No.)



                 12161 Lackland Road, St. Louis, Missouri 63146
                -------------------------------------------------
               (Address of principal executive offices) (Zip Code)

                                 (314) 469-3220
               --------------------------------------------------
              (Registrant's telephone number, including area code)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.


Yes   X            No
    -----             -----

         The Number of shares of the registrant's Common Stock outstanding as of
November 13, 1997 is 9,984,672.


<PAGE>

                    LASERSIGHT INCORPORATED AND SUBSIDIARIES

Except for the historical  information  contained herein, the discussion in this
Report contains forward-looking statements (within the meaning of Section 21E of
the Exchange Act) that involve  risks and  uncertainties.  The Company's  actual
results could differ  materially from those  discussed here.  Factors that could
cause or contribute to such differences  include,  but are not limited to, those
discussed  in the sections  entitled  "Management's  Discussion  and Analysis of
Financial  Condition and Results of Operations - Uncertainties and Other Issues"
in this  report  and in the  Company's  Annual  Report on Form 10-K for the year
ended December 31, 1996.

                                                            INDEX
                                                                          
PART I.  FINANCIAL INFORMATION

         Item 1.   Condensed Consolidated Financial Statements

                   Condensed  Consolidated  Balance  Sheets as of September  30,
                   1997 and December 31, 1996

                   Condensed Consolidated Statements of Operations for the Three
                   Month Periods and Nine Month Periods Ended September 30, 1997
                   and 1996 

                   Condensed Consolidated  Statements of Cash Flows for the Nine
                   Month Periods Ended September 30, 1997 and 1996
                                                                

                   Notes to Condensed Consolidated Financial Statements

         Item 2.   Management's Discussion and  Analysis of Financial  Condition
                   and Results of Operations 

PART II. OTHER INFORMATION

         Item 1.   Legal Proceedings                        

         Item 2.   Changes in Securities                       

         Item 3.   Defaults Upon Senior Securities                

         Item 4.   Submission of  Matters to a Vote of Security Holders 

         Item 5.   Other Information                                

         Item 6.   Exhibits and Reports on Form 8-K                 

<PAGE>
<TABLE>
                         PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
                    LASERSIGHT INCORPORATED AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
<CAPTION>
                                                                                      September 30,      December 31,
                                                                                          1997              1996
                                                                                     ----------------   --------------
CURRENT ASSETS                                            ASSETS                       (Unaudited)
<S>                                                                                       <C>              <C>       
  Cash and cash equivalents                                                               $1,164,158       $2,003,501
  Accounts receivable - trade, net                                                         3,840,332        5,458,153
  Notes receivable - current portion, net                                                  3,711,675        3,159,575
  Inventories                                                                              3,991,541        3,328,903
  Deferred tax assets                                                                        570,296          667,998
  Income taxes recoverable                                                                    22,404          803,154
  Other current assets                                                                       577,019          221,922
                                                                                     ----------------   --------------
                                                     TOTAL CURRENT ASSETS                 13,877,425       15,643,206

Restricted cash                                                                            3,200,000                -
Notes receivable, less current portion, net                                                3,538,268        2,620,375
Property and equipment, net                                                                2,214,293        1,936,220
Deferred financing costs, net                                                                392,043                -
Goodwill, net                                                                             14,783,566       12,099,032
Patents, net                                                                              11,462,339           94,946
Pre-market approval application, net                                                       2,666,708                -
License agreement, net                                                                       800,000                -
Other assets, net                                                                          1,860,807        1,856,434
                                                                                     ----------------   --------------
                                                                                         $54,795,449      $34,250,213
                                                                                     ================  ===============
                                        LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
  Accounts payable                                                                        $2,525,677       $2,216,792
  Note payable, less discount of $322,222                                                  3,677,778                -
  Note payable - related party                                                                     -        1,000,000
  Current portion of capital lease obligation                                                224,549          206,139
  Accrued expenses                                                                         1,748,266          764,084
  Accrued commissions                                                                      1,110,529        1,214,235
  Dividends payable                                                                                -           39,000
  Other current liabilities                                                                   63,998          182,155
                                                                                     ----------------   --------------
                                                  TOTAL CURRENT LIABILITIES                9,350,797        5,622,405

Refundable deposits                                                                          203,000          240,000
Accrued expenses, less current portion                                                       590,369          309,656
Deferred income taxes                                                                        570,296          667,998

Long-term obligations                                                                        971,018          641,623

Commitments and contingencies

Redeemable convertible preferred stock:
  Series B - par value $.001 per share; authorized 10,000,000 shares;
  1,600 and 0   issued at September 30, 1997 and December 31, 1996                        14,374,027                -

Stockholders' equity:
 Convertible preferred stock,  Series A - par value $.001 per share;  authorized
   10,000,000 shares; 0 and 8 shares issued and outstanding at
   September 30, 1997 and December 31, 1996, respectively                                          -                -
 Common stock - par value $.001 per share; authorized 20,000,000 shares;
   10,149,872 and 8,454,266 shares issued at September 30, 1997 and
   December 31, 1996, respectively                                                            10,150            8,454
 Additional paid-in capital                                                               40,018,241       30,080,560
 Paid-in capital - warrants                                                                  592,500                -
 Obligation to issue common stock                                                                  -        3,065,056
 Stock subscription receivable                                                            (1,140,000)      (1,140,000)
 Accumulated deficit                                                                     (10,112,240)      (4,612,830)
 Less treasury stock, at cost;  170,200 shares                                              (632,709)        (632,709)
                                                                                     -----------------  ---------------
                                                                                          28,735,942       26,768,531
                                                                                     -----------------   --------------
                                                                                         $54,795,449      $34,250,213  
                                                                                     =================  ===============
      See  accompanying  notes  to  the  condensed   consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>

                    LASERSIGHT INCORPORATED AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

<CAPTION>

                                                   Three Months Ended                        Nine Months Ended
                                                     September 30,                             September 30,
                                          -------------------------------------      -----------------------------------
                                                1997                 1996                 1997                1996
                                          -----------------     ---------------      ---------------     ---------------

<S>                                             <C>                 <C>                 <C>                 <C>        
REVENUES, Net                                   $6,156,359          $4,494,232          $18,083,073         $15,070,482

COST OF SALES                                    1,068,498             794,982            2,934,001           2,259,527
PROVIDER PAYMENTS                                1,630,616           1,069,184            4,450,855           2,998,680
                                          -----------------     ---------------      ---------------     ---------------

GROSS PROFIT                                     3,457,245           2,630,066           10,698,217           9,812,275

RESEARCH, DEVELOPMENT AND REGULATORY
  EXPENSES                                         816,522             325,925            1,729,153           1,373,547

SELLING, GENERAL AND ADMINISTRATIVE
  EXPENSES                                       4,660,208           4,504,162           13,568,380          12,598,430
                                          -----------------     ---------------      ---------------     ---------------

LOSS FROM OPERATIONS                            (2,019,485)         (2,200,021)          (4,599,316)         (4,159,702)

OTHER INCOME AND EXPENSES
  Interest and dividend income                      94,401              42,195              292,272             132,109
  Interest expense                                (483,794)            (54,480)            (911,966)           (102,068)      
  Other                                                  -            (300,107)            (280,400)           (300,107)
                                          ------------------    -----------------    ----------------    ----------------

NET LOSS BEFORE INCOME TAXES                    (2,408,878)         (2,512,413)          (5,499,410)         (4,429,768)

INCOME TAX BENEFIT                                    -               (458,727)                -             (1,119,378)
                                          ------------------    -----------------     ---------------    ----------------

NET LOSS                                      $ (2,408,878)        $(2,053,686)         $(5,499,410)        $(3,310,390)
                                          ==================    =================    ================    ================

LOSS PER COMMON SHARE
  Primary:                                          $(0.25)             $(0.28)              $(0.59)             $(0.51)
                                          ==================    =================    ================    ================
  Assuming full dilution:                           $(0.25)             $(0.27)              $(0.59)             $(0.47)
                                          ==================    =================    ================    ================

WEIGHTED AVERAGE NUMBER OF SHARES
  OUTSTANDING
  Primary:                                       9,812,000           7,639,000            9,342,000           7,238,000
                                          =================     ===============      ===============     ===============
  Assuming full dilution:                        9,812,000           8,017,000            9,390,000           7,848,000
                                          =================     ===============      ===============     ===============


                         See accompanying notes to condensed consolidated financial statements
</TABLE>


<PAGE>

<TABLE>

                    LASERSIGHT INCORPORATED AND SUBSIDIARIES

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                  NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
                                   (Unaudited)
<CAPTION>

                                                                                  1997                   1996
                                                                            ------------------     ------------------
<S>                                                                               <C>                   <C>   
CASH FLOW FROM OPERATING ACTIVITIES
  Net loss                                                                        $(5,499,410)          $(3,310,390)
  Adjustments to reconcile net loss to net cash used in operating
    activities:
  Depreciation and amortization                                                     1,814,587                711,528
  Decrease in accounts and notes receivable                                           292,828              1,714,377
  Increase in inventories                                                            (879,348)            (1,430,642)
  Increase (decrease) in accounts payable                                             308,885               (300,472)
  Increase (decrease) in accrued liabilities                                          724,447                (36,682)
  Decrease (increase) in income taxes                                                 780,750             (1,404,967)
  Other                                                                              (498,467)               440,532
                                                                            -------------------    ------------------

NET CASH USED IN OPERATING ACTIVITIES                                              (2,955,728)            (3,616,716)

CASH FLOWS FROM INVESTING ACTIVITIES
  Purchase of furniture and equipment, net                                           (517,206)              (250,862)
  Acquisition of other intangible assets                                          (15,379,988)                     -
  Proceeds from exclusive license of patents                                        4,000,000                      -
  Transfer to restricted cash account                                              (3,200,000)                     -
  Purchase of managed care contract                                                  (150,000)                     -
  Purchase of businesses, net of cash acquired                                              -               (179,607)
  Proceeds from sale and leaseback transaction                                              -                957,180
                                                                            ------------------     ------------------

NET CASH PROVIDED BY (USED IN) INVESTING
  ACTIVITIES                                                                      (15,247,194)               526,711

CASH FLOWS FROM FINANCING ACTIVITIES
  Proceeds from issuance of note payable, net                                       3,414,142                      -
  Proceeds from exercise of stock options and warrants                                 98,363                260,289
  Repayments of capital lease obligation                                             (152,195)               (61,735)
  Repayments of notes payable - acquisition related                                (1,000,000)            (1,139,100)
  Repayments of notes payable - officer                                                     -               (465,000)
  Proceeds from issuance of preferred stock, net                                   15,003,269              5,342,151
                                                                            ------------------     ------------------

NET CASH PROVIDED BY FINANCING ACTIVITIES                                          17,363,579              3,936,605
                                                                            ------------------     ------------------

INCREASE (DECREASE) IN CASH AND CASH
  EQUIVALENTS                                                                        (839,343)               846,600

CASH AND CASH EQUIVALENTS,
  BEGINNING OF PERIOD                                                               2,003,501              1,598,339
                                                                            ------------------     ------------------

CASH AND CASH EQUIVALENTS, END OF PERIOD                                           $1,164,158             $2,444,939
                                                                            ==================     ==================


     See accompanying notes to the condensed consolidated financial statements.

</TABLE>


<PAGE>


                    LASERSIGHT INCORPORATED AND SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
              Nine Month Periods Ended September 30, 1997 and 1996


NOTE 1   BASIS OF PRESENTATION

         The accompanying unaudited, condensed consolidated financial statements
         of  LaserSight  Incorporated  and  subsidiaries  (the  Company)  as  of
         September  30,  1997,  and for the three  month  periods and nine month
         periods  ended  September  30,  1997 and 1996  have  been  prepared  in
         accordance with generally  accepted  accounting  principles for interim
         financial  information and with the  instructions to Form 10-Q and Rule
         10-01 of Regulation  S-X.  Accordingly,  they do not include all of the
         information  and  note  disclosures   required  by  generally  accepted
         accounting   principles  for  complete  financial   statements.   These
         condensed   consolidated   financial   statements  should  be  read  in
         conjunction  with  the  consolidated  financial  statements  and  notes
         thereto  included in the  Company's  annual report on Form 10-K for the
         year  ended  December  31,  1996.  In the  opinion of  management,  the
         condensed  consolidated  financial  statements  include all adjustments
         necessary for a fair  presentation of consolidated  financial  position
         and the results of operations and cash flows for the periods presented.
         The results of  operations  for the three and nine month  periods ended
         September  30, 1997 are not  necessarily  indicative  of the  operating
         results for the full year.

NOTE 2   PER SHARE INFORMATION

         Net loss per common share is computed using the weighted average number
         of common shares and common share equivalents  outstanding  during each
         period.  Common  share  equivalents  include  options  and  warrants to
         purchase  Common  Stock and are included in the  computation  using the
         treasury  stock  method if they  would have a  dilutive  effect.  Fully
         diluted  loss per  share for the three  and nine  month  periods  ended
         September 30, 1997 were  anti-dilutive  and  therefore,  except for the
         impact of Preferred  Stock converted to Common Stock during the period,
         are the same as primary loss per share.

         In February 1997,  Statement of Financial  Accounting Standards No. 128
         (SFAS 128), "Earnings Per Share," was issued establishing new standards
         for  computing  and  presenting  earnings  per  share.  The  historical
         measures of earnings per share (primary and fully diluted) are replaced
         with two new  computations  of earnings per share (basic and  diluted).
         The  Company  will adopt SFAS 128 as of  December  31,  1997.  Loss per
         share, on a pro forma basis, for the three and nine month periods ended
         September  30, 1997 and 1996,  computed  pursuant to the  provisions of
         SFAS 128, would have been as follows:

                                       Three Months Ended    Nine Months Ended
                                          September 30,        September 30,
                                          -------------        -------------
                                       1997       1996       1997         1996
                                       ----       ----       ----         ----

         Basic loss per share        $(0.25)    $(0.26)     $(0.59)      $(0.48)

         Diluted loss per share       $(0.25)    $(0.25)    $(0.59)      $(0.41)
<PAGE>

NOTE 3   INVENTORIES

         Inventories,  which  consist  primarily  of laser  systems,  parts  and
         components,  are  stated  at the  lower  of  cost  or  market.  Cost is
         determined  using the first-in,  first-out  method.  The  components of
         inventories  at September 30, 1997 and December 31, 1996 are summarized
         as follows:

                                       September 30, 1997      December 31, 1996
                                       ------------------      -----------------

         Raw materials                     $2,772,585              $2,008,610
         Work-in-process                      107,110                 448,906
         Finished goods                       821,447                 664,646
         Test equipment-clinical trials       290,399                 206,741
                                           -----------            ------------
                                           $3,991,541              $3,328,903
                                          ============            ============


NOTE 4   BUSINESS COMBINATIONS

         LaserSight Centers Incorporated (Centers)
         -----------------------------------------

         In March 1997, the Company amended the purchase and royalty  agreements
         related  to the 1993  acquisition  of  Centers.  The  amended  purchase
         agreement provided for the Company to issue 625,000 unregistered common
         shares  (valued  at   $3,320,321)   with  600,000   additional   shares
         contingently   issuable  based  upon  future  operating  profits.  This
         replaces the  provision  calling for  1,265,333  contingently  issuable
         shares  based on  cumulative  revenues or other  future  events and the
         uncertainties  associated  therewith.  The  amended  royalty  agreement
         reduces the royalty from $86 to $43 per refractive procedure and delays
         the obligation to pay such royalties  until the sooner of five years or
         the issuance of all contingently issuable shares as described above.

NOTE 5   COMMITMENTS AND CONTINGENCIES

         Shareholder vote
         ----------------

         Shareholder  approval  is  required  in  connection  with  the  private
         placement  of  1,600  shares  of  Series  B  Convertible  Participating
         Preferred  Stock  (Series B  Preferred  Stock) (see Note 6). If for any
         reason the Company's shareholders do not approve, by December 26, 1997,
         the possible  issuance of an  indefinite  number of shares  issued upon
         conversion,  the Company  may be  obligated  to redeem,  at the Special
         Redemption Price (as defined below),  a sufficient  number of shares of
         Series B Preferred  Stock which will permit  conversion  of 200% of the
         remaining  shares of Series B Preferred  Stock  without  breaching  any
         obligation of the Company under the Company's  listing  agreement  with
         the Nasdaq National Market. The "Special Redemption Price" means a cash
         payment  equal to the  greater  of (i) the  liquidation  preference  of
         $10,000  multiplied  by 125% or (ii) the  current  value of the  Common
         Stock,  using the price per share of Common Stock, which the holders of
         such shares of Series B Preferred  Stock would otherwise be entitled to
         receive upon conversion.  Such redemption must be completed within five
         business days of the event which required such redemption. Any delay in
         payment  will cause such  redemption  amount to accrue  interest at the
         rate of 1% per  month  during  the first 30 days,  pro rated  daily (2%
         monthly, pro rated daily, thereafter).

<PAGE>

         FDA approval
         ------------

         In conjunction with acquisitions  from Photomed,  Inc. (as described in
         Note 7), several  contingent  payments  included in the transaction are
         subject to FDA  approval.  If the FDA approves the acquired  Pre-Market
         Approval  (PMA)  application  by July 29,  1998,  the  Company  will be
         obligated  to pay $1.75  million.  If the FDA  approves  the use of any
         Company  laser for the  treatment  of  hyperopia,  the Company  will be
         obligated to pay unregistered Common Stock valued at $1 million. If the
         Company's  scanning laser is approved by the FDA for commercial sale in
         the U.S. on or before  April 1, 1998,  the Company will be obligated to
         pay  $1   million.   Approval   after  such  date  will   result  in  a
         correspondingly  smaller  obligation  until  January 1,  1999,  when no
         payment will be required.

NOTE 6   FINANCING

         Foothill Capital Corporation
         ----------------------------

         On April 1,  1997,  the  Company  entered  into a loan  agreement  with
         Foothill Capital Corporation (FCC) for a loan,  currently consisting of
         a term  loan  in the amount of $4  million and a  revolving  loan in an
         amount of 80% of the eligible  receivables of LaserSight  Technologies,
         but not in excess of $3.2 million.  The term loan bears interest  at an
         annual rate of 12.50% and  requires  repayment  of principal in monthly
         installments  of $1.33 million  beginning on May 1, 1998. The revolving
         loan bears  interest at a variable  annual rate of 1.50% above the base
         rate of Norwest Bank Minnesota.  The $3.2 million maximum amount of the
         revolving loan declines by $1.33 million per month  beginning on August
         1, 1998. In connection  with the loan,  the Company paid an origination
         fee of  $150,000  and issued  warrants to  purchase  500,000  shares of
         Common Stock.  The warrants are  exercisable  at any time from April 1,
         1998 through  April 1, 2002 at an exercise  price per share of $6.0667.
         Subject to certain  conditions  based on the market price of the Common
         Stock,  up to half of the warrants are eligible for  repurchase  by the
         Company.  Any warrants that remain outstanding and unexercised on April
         1, 2002 are  subject  to  mandatory  repurchase  by the  Company  at an
         original  price  of  $1.50  per  warrant.  The  warrants  have  certain
         anti-dilution   features   which  provide  for   approximately   50,000
         additional  shares  pursuant to the  issuance of the Series B Preferred
         Stock and a corresponding  reduction in the exercise price to $5.52 per
         share and  repurchase  price to $1.36 per warrant.  The  warrants  were
         valued at $500,000  and are  classified  as  long-term  obligations  at
         September 30, 1997. The recorded  amount of the obligation  will change
         with the  value of the  warrants.  The loan is  secured  by a pledge of
         substantially  all of  the  Company's  accounts  receivable  and  other
         assets.  The  terms  of  the  financing   agreement  contain  financial
         covenants  with respect to, among other things,  current  ratio,  laser
         system sales, revenue,  earnings before interest,  taxes,  depreciation
         and  amortization  (EBITDA),  and  capital  expenditures.  Due  to  the
         operating results of the quarter ended June 30, 1997, certain financial
         covenants  were waived by FCC for the three months ended June 30, 1997.
         The  Company  revised  the  covenants  effective  July 1,  1997.  These
         covenants were met for the three months ended September 30, 1997.

         The Company  used a portion of the net proceeds of the term loan to pay
         in full the  balance  due  under its note to the  former  owners of MEC
         Health Care, Inc., a wholly owned subsidiary of the Company acquired in
         October 1995.
<PAGE>

         Private Placement
         -----------------

         On August 29, 1997, the Company  completed a private placement of 1,600
         shares of Series B Preferred Stock, yielding net proceeds after related
         costs of approximately $15 million.  The proceeds were used to purchase
         certain patents from International  Business Machines Corporation (IBM)
         (see Note 7). The Company also issued to the  investors  and  placement
         agent warrants to purchase 790,000 shares of the Company's Common Stock
         at a price of $5.91 per share at any time  during the next five  years.
         The Series B Preferred  Stock is  convertible  into Common Stock at any
         time at a conversion price equal to the lower of $6.68 per share or the
         average  of  the  three  lowest  closing  bid  prices  during  a 20- or
         30-trading  day  period   preceding  the  conversion   date.  Prior  to
         shareholder  approval of the  transaction,  the number of shares issued
         upon  conversion  will be limited by Nasdaq rule and contract terms and
         contract terms to approximately 1,995,500. Any Series B Preferred Stock
         remaining  unconverted  on the third  anniversary  of the closing  will
         automatically  be converted  into Common  Stock on that date.  Up to 70
         percent of the Series B Preferred Stock is redeemable by the Company at
         a premium over its face amount.  All of the Series B Preferred Stock is
         redeemable  at a 25 percent  premium over its face amount at the option
         of the  holders but only in certain  events of default by the  Company,
         including if the Company does not receive  shareholder  approval of the
         transaction  within 120 days (see Note 5). At September 30, 1997, 1,600
         shares of Series B  Preferred  Stock  were  outstanding.  However,  the
         Company  redeemed 305 shares of Series B Preferred Stock on October 28,
         1997 (see Note 8).  The Series B  Preferred  Stock is  recorded  at the
         amount of gross  proceeds  less the costs of the financing and the fair
         value of the warrants and classified as mezzanine  financing  above the
         stockholders'  equity  section on the balance sheet. A redemption is at
         the option of the holder upon the occurrence of an event of redemption,
         some of which are outside the Company's  control.  The financing  costs
         and warrants  will be accreted  against APIC - common stock if an event
         of  redemption  is assessed as  probable at a balance  sheet date.  The
         calculated  conversion  price on August 29, 1997,  the first  available
         conversion date, was approximately $4.98. In accordance with EITF Topic
         D-60, the difference between this conversion price and the market price
         of $5.00 is reflected as incremental yield to preferred stockholders on
         the  Company's  loss  per  share  calculation  for  the  quarter  ended
         September 30, 1997.

NOTE 7   ACQUISITIONS

         Photomed, Inc.
         --------------

         In July 1997,  the  Company  acquired  the rights to a PMA  application
         filed  with  the  Food and  Drug  Administration  (FDA)  for a laser to
         perform  Laser In-Situ  Keratomileusis  (LASIK),  a refractive  surgery
         alternative to surface Photorefractive Keratectomy (PRK) from Photomed,
         Inc. In addition, the Company purchased from a shareholder of Photomed,
         Inc.  U.S.  patent  number  5,586,980  for a keratome,  the  instrument
         necessary  to create the  corneal  "flap" in the LASIK  procedure.  The
         Company issued a combination of 535,515  unregistered  shares of Common
         Stock (valued at $3,416,700) and $333,300 as consideration  for the PMA
         application  and the  keratome  patent.  The seller will also receive a
         percentage  of any  licensing  fees or  sale  proceeds  related  to the
         patent.  The total value was capitalized as the cost of PMA application
         and patents and is being  amortized over 5 and 15 years,  respectively.
         If the FDA approves the PMA so as to allow the Company to commercialize
         a  laser  to  perform  LASIK  in the  U.S.,  the  Company  will  pay an

<PAGE>

         additional  $1.75  million to the sellers.  If such FDA approval is not
         obtained by July 29, 1998, the Company has the option to unwind the PMA
         transaction  and receive  from  Photomed,  Inc.  274,285  shares of the
         Company's  Common Stock. If the  transaction is unwound,  the Company's
         investment will be reduced by that portion of the PMA value  applicable
         to the proportionate ratio of shares returned. The remaining portion of
         the PMA value will be assessed as to impairment.  Additionally,  if the
         FDA  approves  the use of the  laser  for the  treatment  of  hyperopia
         (farsightedness), the Company will pay unregistered Common Stock valued
         at $1  million  to the  sellers.  If the  Company's  scanning  laser is
         approved  by the FDA for  commercial  sale in the  United  States on or
         before April 1, 1998,  the Company will pay  $1,000,000 to the sellers.
         Approval  after such date will result in lesser  payments until January
         1, 1999,  when no payment  will be required.  Additional  consideration
         paid, if any, will be recorded as additional purchase price.

         Patents
         -------

         On August 29, 1997,  the Company  finalized  an agreement  with IBM, in
         which the Company  acquired  certain  patents  relating to  ultraviolet
         light ophthalmic  products and procedures for ultraviolet  ablation for
         $14,900,000. Under the agreement, IBM transferred to the Company all of
         IBM's  rights  under  its  patent  license   agreements   with  certain
         licensees.  The  Company  received  all  royalties  accrued on or after
         January 1, 1997, under such patent license agreements.  The acquisition
         was financed through the private placement of Preferred Stock (see Note
         6).

         On  September  23,  1997,  the  Company  sold  an  exclusive  worldwide
         royalty-free  patent license  covering the vascular and  cardiovascular
         rights  included  in the  patents  acquired  from  IBM for $4  million,
         reducing the Company's basis in the patents  acquired.  No gain or loss
         was recognized as a result of this sale.  Approximately $3.2 million of
         these funds were placed in a restricted cash account in accordance with
         the  private  placement   agreements  and  were  subsequently  used  to
         voluntarily  redeem a portion of the Preferred  Stock issued to finance
         the purchase of the IBM patents (see Note 8).

         Keratome License
         ----------------

         In September 1997, the Company acquired worldwide  distribution  rights
         to the  Ruiz  disposable  keratome  for the  refractive  surgery  LASIK
         procedure  in  addition to entering  into a limited  exclusive  license
         agreement for intellectual  property for the keratome products known as
         Automated  Disposable  Keratomes  (ADK). In exchange,  the Company paid
         $400,000  at closing and agreed to supply to the sellers at no cost one
         excimer  laser.  Six months after the first  shipment of the disposable
         keratome  product,  the Company will pay an additional  $150,000 to the
         sellers with another  installment  of $150,000 due twelve  months after
         the initial  shipment  date.  The Company will also share the product's
         gross  profit with the sellers  with  minimum  quarterly  royalties  of
         $400,000  beginning six months after the initial  shipment date.  Under
         the  arrangement,  gross  profit is defined as the  selling  price less
         certain costs of goods and costs of sales.

NOTE 8   SUBSEQUENT EVENT

         On October 28, 1997, the Company voluntarily redeemed 305 shares of the
         Preferred Stock (approximately 19 percent). The Company paid a total of
         $3,172,000 including a four percent redemption premium.



<PAGE>


ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

Results of Operations
---------------------
Net  Sales.  The  following  tables  present  the  Company's  net sales by major
operating  segments:  technology  products and services and health care services
for the three and nine month periods ended September 30, 1997 and 1996.
<TABLE>
<CAPTION>

                                            For the Three Month                          For the Three Month
                                                Period Ended                                 Period Ended
                                             September 30, 1997                           September 30, 1996
                                             ------------------                           ------------------

                                           Net Sales         % of Total                  Net Sales        % of Total
                                           ---------         ----------                  ---------        ----------

<S>                                       <C>                       <C>                 <C>                      <C>
Technology                                $2,677,831                43%                 $1,783,577               40%
Health care services                       3,478,528                57%                  2,810,613               62%
Intercompany revenues                             --                 --                   (99,958)              (2%)
                                          -----------              ----                 ----------              ----

Total net sales                           $6,156,359               100%                 $4,494,232              100%
                                          ===========              ====                 ==========              ====


                                             For the Nine Month                           For the Nine Month
                                                Period Ended                                 Period Ended
                                             September 30, 1997                           September 30, 1996
                                             ------------------                           ------------------

                                           Net Sales         % of Total                  Net Sales        % of Total
                                           ---------         ----------                  ---------        ----------

Technology                                $8,362,374                46%                 $7,246,984               48%
Health care services                       9,720,699                54%                  8,158,263               54%
Intercompany revenues                             --                --                   (334,765)              (2%)
                                          ----------               ----                 ----------              ----
                                                  

Total net sales                          $18,083,073               100%                $15,070,482              100%
                                         ===========               ====                ===========              ====
</TABLE>

Net sales in the third quarter of 1997 were  $6,156,359,  compared to $4,494,232
(for an increase  of 37%) over the same  period in 1996.  Net sales for the nine
month period ended  September 30, 1997,  increased by $3,012,591 to  $18,083,073
from the same period in 1996.  The increase in health care  service  revenue for
the nine month period ended  September 30, 1997, was  attributable  to increased
revenues  generated by MEC Health Care,  Inc.  (MEC) and LSI  Acquisition,  Inc.
(LSIA),  offset by a  substantial  reduction  in revenues  generated by MRF Inc.
d/b/a The Farris  Group (The Farris  Group).  Net sales for The Farris Group for
the nine month period  ended  September  30, 1997  decreased  by  $1,879,931  to
$1,010,298  from the same period in 1996.  This  decrease was due primarily to a
reduction in  consulting  services  provided and was  accompanied  by an expense
reduction of $1,837,739 for the nine month period ended  September 30, 1997. The
decrease in  revenues  generated  by The Farris  Group was  partially  offset by
increased revenues generated by MEC in the amount of $1,821,030. The increase in
technology  revenues  in the third  quarter of 1997 was  attributed  to a slight
increase in net sales of the  Company's  LaserScan  2000 excimer laser system in
overseas markets and improved pricing resulting from the Company's limited sales
of the LS 300 model, a lower priced  system.  Ten laser systems were sold in the
third quarter of 1997 compared to nine systems,  net of return allowances,  sold

<PAGE>

over the same period in 1996.  Thirty-three  laser  systems were sold during the
nine month period ended September 30, 1997, compared to twenty-nine systems, net
of return allowances,  sold over the same period in 1996. The Company believes a
contributing  factor to the lower  than  expected  number of laser  sales is the
anticipation,  particularly in Europe,  of the introduction of the LaserScan LSX
announced in April 1997.  Technology revenues in 1996 included higher allowances
for  sales  returns,   reflecting  differences  between  actual  experience  and
previously estimated amounts. There were no system returns recognized during the
first three  quarters of 1997.  Based on the expected  timing of the  commercial
introduction of its newest laser system,  the LaserScan LSX, the Company expects
laser  system  sales to remain  below 1996 levels for the  remaining  quarter of
1997, although it expects such sales to exceed the levels attained on average in
the second and third quarters of 1997.

Cost of Goods Sold and Gross Profits. The following tables present a comparative
analysis of cost of goods sold,  gross profit and gross profit margins for three
and nine month periods ended September 30, 1997 and 1996.
<TABLE>
<CAPTION>

                                              For the Three Month                            For the Three Month
                                                  Period Ended                                   Period Ended
                                               September 30, 1997       Percent Change        September 30, 1996
                                               ------------------       --------------        ------------------

<S>                                               <C>                          <C>                 <C>        
Cost of goods sold                                $   1,068,498                34%                 $   794,982
Provider payments                                     1,630,616                53%                   1,069,184
Gross profit                                          3,457,245                31%                   2,630,066
Gross profit percentage                                     56%                                            59%

Technology related only                               1,609,333                63%                     988,595
                                                            60%                                            55%

                                               For the Nine Month                             For the Nine Month
                                                  Period Ended                                   Period Ended
                                               September 30, 1997       Percent Change        September 30, 1996
                                               ------------------       --------------        ------------------

Cost of goods sold                                   $2,934,001                30%                  $2,259,527
Provider payments                                     4,450,855                48%                   2,998,680
Gross profit                                         10,698,217                 9%                   9,812,275
Gross profit percentage                                     59%                                            65%

Technology related only                               5,428,373                 9%                   4,987,457
                                                            65%                                            69%

</TABLE>
Gross profit margins were 56% of net sales in the third quarter of 1997 compared
to 59% for the same period in 1996.  For the nine-month  period ended  September
30, 1997 and 1996, gross profit margins were 59% and 65%, respectively.  For the
nine-month period ended September 30, 1997, the gross profit margin decrease was
attributable  to (i) the  decrease in revenues  generated  by The Farris  Group,
which  has no  associated  cost of sales,  (ii) a  significant  increase  in MEC
revenues with a corresponding increase in provider payments,  which historically
have ranged from  approximately  68 to 72% of MEC revenues,  and (iii) a general
increase in the  operating  costs of the  Company's  Costa  Rican  manufacturing
facility,  which were spread over fewer sales during the nine month period ended
September 30, 1997.
<PAGE>

Research,  Development and Regulatory  Expenses.  The following tables present a
comparative  analysis of research,  development and regulatory  expenses for the
three and nine month periods ended September 30, 1997 and 1996.
<TABLE>
<CAPTION>

                                          For the Three Month                                For the Three Month
                                              Period Ended                                       Period Ended
                                           September 30, 1997          Percent Change         September 30, 1996
                                           ------------------          --------------         ------------------

<S>                                             <C>                          <C>                   <C>
Research, development
   and regulatory                               $  816,522                   151%                  $  325,925

As a percentage of technology
   net sales                                           30%                                                18%


                                           For the Nine Month                                 For the Nine Month
                                              Period Ended                                       Period Ended
                                           September 30, 1997          Percent Change         September 30, 1996
                                           ------------------          --------------         ------------------

Research, development
   and regulatory                             $  1,729,153                     26%                 $1,373,547

As a percentage of technology
   net sales                                           21%                                                19%
</TABLE>

Research, development and regulatory expenses for the third quarter of 1997 were
$816,522,  an increase of $490,597,  or 151% from such  expenditures  during the
same period in 1996. Research,  development and regulatory expenses for the nine
month period ended  September 30, 1997 increased by $355,606 from $1,373,547 for
the same  period in 1996 or 26%.  The  increase  in  research,  development  and
regulatory expenses during the third quarter of 1997 can primarily be attributed
to ongoing research and development of new refractive  laser systems,  including
development of the LaserScan LSX and added features for the LaserScan-2000,  and
continued software development for the excimer lasers.  Initial shipments of the
LaserScan  LSX are  anticipated  during the later part of the fourth  quarter of
1997.  Since the initial  announcement  of the development of the LaserScan LSX,
the Company has solicited and received input from clinical users and prospective
customers.  This has  resulted in  modifications  to the  system,  necessitating
additional  development  and testing  for  clinical  validation.  As a result of
focusing  its  efforts  on  having  the  LaserScan  LSX  available  for  limited
commercial  production  and shipment in the later part of the fourth  quarter of
1997, the Company expects research and development  expenses to remain at levels
consistent  with or  higher  than  third  quarter  1997  levels  throughout  the
remainder  of  1997.  Regulatory  expenses  for the  three  month  period  ended
September 30, 1997 have  increased in comparison to the same period in the prior
year although for the nine month period ended  September 30, 1997 there has been
a  decrease  in  comparison  to the same  period in the prior  year.  Regulatory
expenses are expected to continue to increase for the remaining  portion of 1997
and into 1998 as a result of the Company's  continuation of current FDA clinical
trials,  protocols  added  during  1997  related  to  the  potential  use of the
Company's laser systems for treatment of glaucoma,  the possible  development of
additional  future  protocols for  submission to the FDA and the PMA acquired in
July 1997 (see Note 7).
<PAGE>

Selling,  General and  Administrative  Expenses.  The following tables present a
comparative  analysis of selling,  general and  administrative  expenses for the
three and nine month periods ended September 30, 1997 and 1996.
<TABLE>
<CAPTION>

                                     For the Three Month                                     For the Three Month
                                         Period Ended                                            Period Ended
                                      September 30, 1997            Percent Change            September 30, 1996
                                      ------------------            --------------            ------------------

<S>                                         <C>                             <C>                    <C>   
Selling, general and   
  administrative                           $4,660,208                      3%                     $4,504,162

Percentage of net sales                            76%                                                   100%

                                      For the Nine Month                                      For the Nine Month
                                         Period Ended                                            Period Ended
                                      September 30, 1997            Percent Change            September 30, 1996
                                      ------------------            --------------            ------------------

Selling, general and
   administrative                         $13,568,380                       8%                    $12,598,430

Percentage of net sales                           75%                                                     84%
</TABLE>

Selling,  general and administrative expenses increased by $156,046 and $969,950
for the third  quarter of 1997 and the first nine months of 1997,  respectively,
over comparable periods in 1996. The primary reasons for these increases include
the  continued  growth  of MEC,  increased  amortization  costs  resulting  from
acquired  patents,  license  agreements  and  other  intangibles,  and a general
increase in personnel and costs  necessary to fund the strategic  initiatives of
the Company and the development of its products and services. These increases in
operating  costs  were  partially  offset  by a  substantial  reduction  in  the
operating costs of The Farris Group. Legal and accounting  expenditures continue
to be  incurred as a result of ongoing  regulatory  filings,  general  corporate
issues, litigation and patent issues.

Loss From  Operations.  There was an operating  loss of  $2,019,485 in the third
quarter of 1997 compared to an operating  loss of $2,200,021 for the same period
in 1996. The operating  loss for the nine month period ended  September 30, 1997
was  $4,599,316  compared to an operating loss of $4,159,702 for the same period
in 1996.  The  improved  operating  results  during  the third  quarter  of 1997
compared to 1996 resulted from  increased  revenues and gross profit,  partially
offset by increases primarily in research,  development and regulatory expenses.
The decline in operating  results for the nine month period ended  September 30,
1997  compared to the same  period in 1996 can be  attributed  primarily  to the
combination of improved overall  revenues and gross profit,  offset by increases
in operating expenses.

Other Income and Expenses. Interest and dividend income was $94,401 in the third
quarter of 1997  compared to $42,195 for the same period in 1996.  Interest  and
dividend  income for the nine month period ended September 30, 1997 was $292,272
compared to $132,109 for the same period in 1996.  Interest and dividend  income
was earned from the Company's cash deposits and short-term  investments  and the
collection  of long-term  receivables  related to laser system  sales.  Interest
expense  incurred was $483,794 in the third quarter of 1997 compared to interest
expense of $54,480  for the same period in 1996.  Interest  expense for the nine
month period ended September 30, 1997 was $911,966  compared to interest expense
of  $102,068  for the same  period in 1996.  Interest  expense  incurred  by the
Company  during the second and third  quarters of 1997 related  primarily to the
credit facility  established  with FCC on April 1, 1997. In addition to interest

<PAGE>

paid on the outstanding  note payable  balance,  included in interest expense is
the  amortization of deferred  financing costs, the accretion of the discount on
the note  payable  and,  in the third  quarter  of 1997,  fees  associated  with
amendments to the original loan agreement. Included in other expense in 1997 and
1996 are  costs  related  to  settling  patent  and other  filed and  threatened
litigation.

Income  Taxes.  For the three and nine months  ended  September  30,  1997,  the
Company  recorded  no income tax  benefit or expense  compared  to an income tax
benefit of $1,119,378  for the nine month period ended  September 30, 1996.  The
lack of income tax benefit  for the first three  quarters of 1997 has been based
on the lack of availability of loss carrybacks.

Net Loss.  Net loss for the third quarter of 1997 was  $2,408,878  compared to a
net loss of $2,053,686  for the same period in 1996. Net loss for the nine month
period  ended  September  30,  1997  was  $5,499,410  compared  to a net loss of
$3,310,390  for the same period in 1996. The loss is attributed to a combination
of  increased  revenues  from  technology  products  and  MEC  services,  losses
generated  from The Farris  Group and higher  operating  expenses as  previously
described for the first three quarters of 1997.

Loss Per Common Share.  Loss per primary and fully  diluted  share  decreased to
$0.25  during  the  third   quarter  of  1997   compared  to  $0.28  and  $0.27,
respectively,  for the same period in 1996.  Loss per primary and fully  diluted
share  increased  to $0.59 for the nine month period  ended  September  30, 1997
compared to $0.51 and $0.47, respectively, for the same period in 1996. Weighted
average shares  outstanding  increased as a result of the conversion into Common
Stock of 18 shares of  convertible  Preferred  Stock issued in January 1996, the
exercise of options and warrants,  the 1997 amendment to the purchase  agreement
related  to  LaserSight  Centers,  the  issuance  of shares  under  the  earnout
provisions  of the 1994  acquisition  of The Farris  Group and the  issuance  of
shares in conjunction  with the 1997 acquisition of rights to a PMA and keratome
patent.

Liquidity and Capital Resources.
--------------------------------

Working capital  decreased  $5,494,173 from  $10,020,801 at December 31, 1996 to
$4,526,628 as of September 30, 1997. This decrease in working  capital  resulted
primarily  from the net loss  previously  mentioned,  purchases of furniture and
equipment and investments in PMA rights, a keratome patent and license agreement
and a vision managed care contract.

Operating activities used net cash of $2,955,728 during the first nine months of
1997,  compared to  $3,616,716  of net cash used during the same period in 1996.
This decrease in cash used is primarily  attributable to a substantial  decrease
in income  tax  assets  during  the first  nine  months of 1997.  Other  factors
resulting in this decrease  include an increase in amortization and depreciation
costs,  a decrease  in net  receivables  and an  increase  in accrued  expenses,
partially  offset by an  increase  in the net loss for the first nine  months of
1997.  The Company used  $15,247,194  in cash  related to  investing  activities
during the first nine months of 1997 compared to $526,711 of cash being provided
by investing activities over the same period in 1996. Net cash used in investing
activities  during the first three quarters of 1997 can be primarily  attributed
to the  acquisition  of certain  patents  and  license  agreements  from IBM and
others,  the  purchase of office and computer  equipment,  and the purchase of a
vision  managed  care  contract,  partially  offset  by the  proceeds  from  the
exclusive licensure of such patents.  Net cash provided by financing  activities
during  the first  nine  months of 1997 was  $17,363,579  and  consisted  of net
proceeds from the issuance of Preferred  Stock to finance the acquisition of the
IBM patents,  the credit  facility  with FCC and the exercise of stock  options,
offset by the  repayment  of a note  payable  to  former  owners of MEC and cost
related to the  repayment of a capital lease  obligation.  That compares to cash
provided by financing activities in the first nine months of 1996 of $3,936,605,
consisting of net proceeds from the sale of common and preferred  stock totaling
$5,602,440  net of a repayment of  $1,665,835 in notes payable and capital lease
obligations.
<PAGE>

The Company  experienced  a  significant  increase  in  negative  cash flow from
operations in the third  quarter of 1997,  largely  resulting  from the level of
laser  system sales and the increase in  research,  development  and  regulatory
expenses  resulting from the  development of the LaserScan LSX and other efforts
as previously  described.  The Company expects cash flow from operations to show
improvement  in the fourth quarter of 1997 and first quarter of 1998 as a result
of the expected shipment of the LaserScan LSX and ADKs as previously  discussed.
Based on these factors,  the Company believes that its balances of cash and cash
equivalents along with expected operating cash flows and the availability of the
FCC  revolver  will  be  sufficient  to fund  its  anticipated  working  capital
requirements  for the next  twelve  month  period  based on  modest  growth  and
anticipated  collection of  receivables.  A failure to collect timely a material
portion of current  receivables  or  unexpected  delays in the  shipment  of the
LaserScan  LSX or ADK  products  could  have a  material  adverse  effect on the
Company's  liquidity.  The  Company,  which  implemented  more  stringent  sales
criteria  during 1996,  may from time to time reassess its credit policy and the
terms it will make available to individual  customers.  As a result of a growing
presence in a number of countries  and  continued  acceptance  of the  Company's
laser  systems,  the Company  intends to  internally  finance a  proportionately
smaller number of sales over periods exceeding  eighteen months than in 1996 and
preceding  years.  There  can be no  assurance  as to the  terms  or  amount  of
third-party  financing,  if any, that the Company's  customers may obtain in the
future.  The Company is placing  greater  emphasis  on the terms and  collection
timing of future sales.

During the third  quarter of 1997,  the Company and FCC modified  the  financial
covenants related to the FCC credit facility. The Company has complied with such
covenants  for  the  quarter  ended  September  30,  1997.  Some  covenants  are
cumulative in nature and meeting them will require continuous improvement in the
Company's operating  performance.  Should such operating levels not be achieved,
the Company would be in default of its agreement and FCC would have the right to
accelerate the Company's repayment obligation.  In addition,  such default would
entitle the holders of Series B Preferred Stock to have the right to redeem at a
premium over the face amount.

The Company expects to continue a variety of research and development activities
on its excimer and solid-state  laser systems over the next twelve months and it
is anticipated that such research and development as well as regulatory  efforts
in the United States will be the most significant technology related expenses in
the foreseeable future. In addition,  the Company expects to aggressively pursue
vision managed care contracts with HMOs, insurers and employer groups during the
next 12 months.  The  Company  anticipates  that such  efforts  will be the most
significant health care services-related expenses in the foreseeable future.

On November 13, 1996,  the Company  announced that it had engaged the investment
banking firm of A.G. Edwards & Sons to explore and evaluate  strategic  business
opportunities. Such efforts were put on hold in June 1997.

In October  1996,  the Company  announced an  agreement in principle  with Laser
Vision Centers,  Inc. ("Laser Vision") to create a joint venture to make excimer
laser  technology  available  to  the  participating  physicians  of  LaserSight
Centers.  Although  the Company and Laser  Vision have to date not  executed any
written  agreement  or resolved  pricing  and other  issues,  they  occasionally
discuss various possible joint ventures  involving the two companies.  There can
be no assurance that such discussions will lead to a definitive  agreement or as
to the terms of any such agreement.
<PAGE>

On March 4,  1997,  the  Company  announced  a  tentative  agreement  to acquire
Intermountain   Managed  Eyecare,   of  Salt  Lake  City,  Utah,  a  third-party
administrator of managed vision care contracts with a business  strategy similar
to the Company's MEC Health Care subsidiary.  The Company originally anticipated
closing this  transaction  on March 15, 1997.  The Company has determined not to
proceed with this transaction at this time.

The Company is receptive to joint venture discussions with compatible  companies
for the development and operation in  international  markets of surgical centers
that will utilize the Company's products or provide synergies to the development
of managed  networks.  In addition to cash  contributions  that may be available
from joint venture partners, the Company is also seeking complementary strengths
and other synergies that may provide  strategic  advantages.  The Company has no
present  commitments  for joint venture  relationships,  and no assurance can be
given that any such  relationship  will be secured on terms  satisfactory to the
Company.

UNCERTAINTIES AND OTHER ISSUES

The Company's business,  results of operations and financial conditions may also
be affected by a variety of  factors,  including  the ones noted below and under
the same caption in the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1996.

Company-Related Uncertainties
-----------------------------

Redemption  Consequences  if  Stockholder  Approval is Not Obtained.  If for any
reason the  Company's  shareholders  do not approve,  by December 26, 1997,  the
possible issuance of an indefinite number of shares issued upon conversion,  the
Company will be obligated to redeem, at the Special Redemption Price (as defined
below),  a  sufficient  number of shares of Series B Preferred  Stock which will
permit  conversion of 200% of the remaining  shares of Series B Preferred  Stock
without  breaching any  obligation  of the Company  under the Company's  listing
agreement with the Nasdaq National Market. The "Special  Redemption Price" means
a cash payment equal to the greater of (i) the liquidation preference of $10,000
multiplied  by 125% or (ii) the  current  value of the Common  Stock,  using the
price per share of Common  Stock,  which the  holders of such shares of Series B
Preferred  Stock would  otherwise be entitled to receive upon  conversion.  Such
redemption  must be  completed  within  five  business  days of the event  which
required such redemption. Any delay in payment will cause such redemption amount
to accrue  interest  at the rate of 1% per month  during the first 30 days,  pro
rated daily (2% monthly, pro rated daily, thereafter).  

Unlimited Number of Shares Issuable to Series B Holders,  Subject to Shareholder
Approval and Based on the Conversion Formula. Although the holders of the Series
B  Preferred  Stock have  voting  rights  only under the  limited  circumstances
required by Delaware corporate law and are not entitled to receive any dividends
unless dividends are concurrently paid on the Common Stock, there is no limit on
the number of shares which the holders of the Series B Preferred  Stock would be
entitled to receive upon the conversions thereof, subject to the approval of the
Company's  shareholders of the issuance of more than 1,995,532  shares of Common
Stock in  connection  with  such  conversions.  In  addition,  in the event of a
liquidation of the Company, the holders of the Series B Preferred Stock would be
entitled to receive  distributions  in  preference  to the holders of the Common
Stock.

Uncollectible  Receivables  Could  Potentially  Exceed  Reserves  for  Estimated
Losses. At September 30, 1997, the Company's trade accounts and notes receivable
aggregated  approximately  $11,090,000  net of total  allowances  for collection
losses and returns of approximately $1,650,500.  Approximately 87 percent of net

<PAGE>

receivables  at September  30, 1997 relate to  international  accounts.  Accrued
commissions,  the payment of which  generally  depends on the collection of such
net trade accounts and notes receivable,  aggregated approximately $1,551,000 at
September  30,  1997.  Exposure  to  collection  losses  on   technology-related
receivables  is  principally   dependent  on  the  Company's  customers  ongoing
financial  condition and their  ability to generate  revenues from the Company's
laser  systems.  The Company's  ability to evaluate the financial  condition and
revenue  generating  ability of  prospective  customers  located  outside of the
United States is generally more limited than for customers located in the United
States.  The Company  monitors  the status of its  receivables  and  maintains a
reserve  for  estimated  losses.  The  Company's   operating  history  has  been
relatively  short.  There can be no  assurance  that the  current  reserves  for
estimated losses  ($1,393,000 at September 30, 1997) will be sufficient to cover
actual  write-offs over time.  Actual  write-offs that materially exceed amounts
reserved  could have a material  adverse  effect on the  Company's  consolidated
financial condition and results of operations.

Possible  Issuance of  Stock--The  Farris  Group.  To the extent that an earnout
provision  relating to the Company's  acquisition of The Farris Group in 1994 is
satisfied  based on certain annual pre-tax income targets  through  December 31,
1998, the Company would be required to issue to the former owner of such company
(Mr.  Michael  R.  Farris,  the  President  and Chief  Executive  Officer of the
Company) an aggregate of up to 750,000 shares of Common Stock (collectively, the
"Farris Earnout Shares"). To date 406,700 Farris Earnout Shares have been issued
based on the operating results of the Farris Group through December 31, 1995. As
a result of the loss incurred by The Farris Group during 1996, no Farris Earnout
Shares became issuable for such year. If additional Farris Earnout Shares become
issuable, goodwill and the resulting amortization expense will increase.

Contingent  Commitments to Issue  Additional  Shares.  The Company has agreed in
connection  with its  acquisition  of the assets of the  Northern New Jersey Eye
Institute  by LSIA in July  1996 to issue up to  102,798  additional  shares  of
Common  Stock if the fair market  value of the Common Stock in July 1998 is less
than $15 per share.  The  Company  may from time to time in the  future  include
similar  provisions  in other  acquisitions.  Investors  who  benefit  from such
provisions  effectively  receive limited  protection from declines in the market
price of the Common Stock,  but other  investors can expect to incur dilution of
their  ownership  interest  in the event of a decline in the price of the Common
Stock.

Possible Need for Additional  Capital.  The Company may seek alternative sources
of capital to fund its  product  development  activities, to  consummate  future
strategic  acquisitions,  and to accelerate its  implementation  of managed care
strategies.  The Company may also need additional capital to introduce its laser
systems  into the United  States  market  after  receiving  FDA  approval and to
satisfy  certain  contingent  payment  obligations  under  its  PMA  acquisition
agreement of July 1997.  In addition,  the Company may have  additional  capital
requirements upon certain FDA approvals and other events.  Except for up to $3.2
million of additional  borrowing  available  under its credit facility with FCC,
the Company has no present commitments to obtain such capital,  and no assurance
can be given that the Company will be able to obtain additional capital on terms
satisfactory to the Company.  To the extent that future  financing  requirements
are satisfied through the sale of equity securities, holders of Common Stock may
experience  significant dilution in earnings per share and in net book value per
share.  The FCC financing or other debt financing  could result in a substantial
portion  of the  Company's  cash flow from  operations  being  dedicated  to the
payment  of  principal  and  interest  on such  indebtedness  and may render the
Company more vulnerable to competitive pressures and economic downturns.

Risks  Associated  with  Acquisitions.  The  Company  has made four  significant
corporate  acquisitions  in the last four years (The Farris Group,  MEC,  LSIA's
acquisition  of the  assets  of NNJEI,  and  Photomed),  as well as other  asset
acquisitions  including  the IBM  patents.  Although  the  Company is  currently
focusing on existing  operations,  the future  ability of the Company to achieve
growth through  acquisitions  will depend on a number of factors,  including the

<PAGE>

availability of attractive acquisition opportunities,  the availability of funds
needed to complete  acquisitions,  the availability of working capital needed to
fund the  operations  of  acquired  businesses  and the effect of  existing  and
emerging  competition on operations.  These prior  acquisitions,  as well as any
future acquisitions,  may not achieve adequate levels of revenue,  profitability
or  productivity  or may not otherwise  perform as expected.  Acquisitions  also
involve special risks, including risks associated with unanticipated liabilities
and  contingencies,  diversion of  management  attention  and  possible  adverse
effects on earnings  resulting from increased goodwill  amortization,  increased
interest costs, the issuance of additional  securities and difficulties  related
to the integration of the acquired business.  Should additional  acquisitions be
sought,  there can be no assurance that the Company will be able to successfully
identify  additional  suitable  acquisition   candidates,   complete  additional
acquisitions or integrate acquired business into its operations.

Significant  Intangible  Assets.  Approximately  $31.1  million of the Company's
total assets as of September 30, 1997 represents  intangible assets arising from
acquisitions,  of which  approximately  $14.8 million is goodwill which is being
amortized  using an estimated  life  ranging from 12 to 25 years,  approximately
$11.5  million is the cost of patents  which are being  amortized  over a period
ranging  from 8 to 17  years,  and  approximately  $4.8  million  is the cost of
licenses and technology  acquired which is being amortized over a period ranging
from 31 months to 12 years.  Goodwill is an intangible asset that represents the
difference  between the total purchase price of the  acquisitions and the amount
of such purchase price  allocated to the fair value of the net assets  acquired.
Goodwill and other  intangibles  are amortized  over a period of time,  with the
amount  amortized in a particular  period  constituting a non-cash  expense that
reduces the  Company's  net income in that  period.  A  reduction  in net income
resulting from the  amortization  of goodwill and other  intangibles may have an
adverse impact upon the market price of the Company's Common Stock. In addition,
in the event of a sale or liquidation of the Company or its assets, there can be
no assurance that the value of such intangible assets would be recovered.

Health Care Services-Related Uncertainties
------------------------------------------

Risks  Associated  with Managed Care Contracts.  As an increasing  percentage of
optometric and  ophthalmologic  patients are coming under the control of managed
care entities,  the Company  believes that its success will, in part,  depend on
the Company's  ability to negotiate  contracts  with HMOs,  employer  groups and
other private  third-party payors pursuant to which services will be provided on
a risk-sharing or capitated basis.  Under some of such agreements,  the eye care
provider  accepts a  predetermined  amount per month per patient in exchange for
providing  all  necessary  covered  services  to  the  enrolled  patients.  Such
contracts  pass  much of the  risk of  providing  care  from  the  payer  to the
provider.  The  proliferation of such contracts in markets served by the Company
could result in greater predictability of revenues, but greater unpredictability
of expenses.  There can, however,  be no assurance that the Company will be able
to negotiate satisfactory  arrangements on a risk-sharing or capitated basis. In
addition,  to the extent that  patients or enrollees  covered by such  contracts
require more frequent or extensive care than anticipated,  operating margins may
be reduced or, in the worst case,  the revenues  derived from such contracts may
be insufficient to cover the costs of the services  provided.  As a result,  the
Company may incur additional costs, which would reduce or eliminate  anticipated
earnings  under such  contracts and could have a material  adverse affect on the
Company's results of operations.

Health Care  Regulation - General.  The Company is subject to  extensive  state,
federal  and  local  regulations.  The  Company  is also  subject  to  laws  and
regulations  relating to business  corporations in general. The Company believes
its operations are in substantial compliance with applicable law. However, there
can be no assurance that review of the Company's business,  its affiliates,  and
contractual  arrangements  by courts  or  health  care,  tax,  labor,  and other
regulatory  authorities will not result in  determinations  that could adversely
affect the operations of the Company.  Also,  there can be no assurance that the

<PAGE>

health care  regulatory  environment  will not change and restrict the Company's
existing operations or limit the expansion of the Company's business. The health
care industry is presently  experiencing  sweeping and dynamic  change.  Much of
this change has been prompted by market forces.  Numerous legislative  proposals
and laws also have prompted  other  changes in the  industry.  In recent years a
number of governmental and other public initiatives have developed to reform the
health  care  system  in  the  United  States.  If  adopted,  certain  of  these
initiatives could  substantially  alter the method of delivery and reimbursement
for  medical  care  services in this  country.  There can be no  assurance  that
current or future  legislative  initiatives or governmental  regulation will not
adversely affect the business of the Company.

More  generally,  in recent  years  there  have been  changes  in  statutes  and
regulations  regarding  the  provision  of health care  services and the Company
anticipates  that such statutes and regulations  will continue to be the subject
of future modification.  The Company cannot predict what changes may be enacted,
and what effect changes in these regulations might have upon the Company and its
prospects.  It is  possible  that  federal or state  legislation  could  contain
provisions  resulting in  governmental  price  ceilings  (even on procedures for
which  government  health insurance is not available) which may adversely affect
the ophthalmic laser market or otherwise adversely affect the Company's business
in the United States. The uncertainty  regarding additional health care statutes
or regulations,  and the enactment of reform legislation,  could have an adverse
affect on the development and growth of the company's  business and might result
in additional volatility in the market price of the Company's securities.

Health Care  Regulation  -  Referrals.  The health  care  industry is subject to
"anti-referral" and "anti-kickback" laws governing patient referrals,  and other
laws concerning fee splitting with non-physicians. Although the Company believes
that its operations are in substantial compliance with existing applicable laws,
the  Company's  business  operations  have not been the  subject of  judicial or
regulatory  review.  There can be no assurance that the Company's  business will
not be reviewed in the future,  and if reviewed or  challenged  that the Company
would  prevail.  Any such review or challenge of the  Company's  business  could
result in  determinations  that could  adversely  affect the  operations  of the
Company.  There can be no assurance that the health care regulatory  environment
will not change so as to restrict the  Company's  existing  operations  or their
expansion.  Aspects of certain health care reforms as proposed in the past, such
as  further   reductions  in  Medicare  and  Medicaid  payments  and  additional
prohibitions on physician  ownership,  directly or indirectly,  or facilities to
which they refer patients, if adopted, could adversely affect the Company.

Corporate  Practice  of  Medicine.  The laws of many  states  prohibit  business
corporations  or other  non-professional  corporations  such as the Company from
practicing medicine and employing  physicians to practice medicine.  The Company
intends to perform only non-medical  administrative services, does not represent
to the public or  patients or  participating  providers  that it offers  medical
services, and does not intend to exercise influence or control over the practice
of medicine by the participating  providers with whom it affiliates  pursuant to
contractual  arrangements.  Accordingly,  the Company believes that its intended
operations  will not be in violation of  applicable  state laws  relating to the
practice of medicine.  However,  the laws in most states regarding the corporate
practice of medicine  have been  subjected to limited  judicial  and  regulatory
interpretation  and,  therefore,  no assurances  can be given that the Company's
activities  will be found to be in compliance,  if challenged.  The laws of many
states also prohibit non-professional corporations such as the Company and other
entities that are not owned entirely by physicians  from  employing  physicians,
optometrists  and other  similar  provessionals  having  control  over  clinical
decision-making,  or engaging in other  activities that are deemed to constitute
the  practice  of   medicine.   Some  states  also   prohibit   non-professional
corporations from owning, maintaining or operating an office or facility for the
practice of medicine.  Some states also prohibit  non-professional  corporations
from owning,  maintaining or operating an office or facility for the practice of
medicine.  These laws may be  construed to permit  arrangements  under which the
physicians are not employed by or otherwise controlled as to clinical matters by
the party  supplying such facilities and  non-professional  services but provide
services under contract with such an entity.
<PAGE>

Professional  Liability.  Although  the Company does not intend to engage in the
practice of medicine,  there can be no assurance  that the Company will not have
liability arising from the medical services, utilization review, peer review, or
other similar activities, of the participating providers.  Under its contractual
arrangements,   the  Company  requires  all  participating  providers  to  carry
professional liability insurance and other insurance necessary to insure against
such risks,  and, where  possible,  to add the Company as an additional  insured
under  such  professional  liability  insurance  policies  and other  applicable
policies of the participating  provider.  It is unlikely that such insurers will
add the Company as an additional insured.  The Company carries general liability
and casualty  insurance,  but there can be no assurance that claims in excess of
any  insurance   coverage  will  not  be  asserted  against  the  Company.   The
availability  and cost of such  insurance  is beyond the control of the Company,
and the cost of such  insurance to the Company may have an adverse effect on the
Company's  operations.  Additionally,  successful  claims of liability  asserted
against the Company that exceed  applicable  policy limits could have a material
adverse effect on the Company.

Competition. The Company will compete with other companies which seek to acquire
the business assets of, provide  management and other services to, and affiliate
with  existing  provider  practices.  Other  companies  are actively  engaged in
businesses  similar to that of the  Company,  some of which  have  substantially
greater financial  resources and longer operating histories than the Company and
are located in areas  where the  Company  may seek to expand in the future.  The
Company assumes that additional  companies with similar objectives may enter the
Company's  markets  and compete  with the Company and there can be no  assurance
that the  Company  will be able to  compete  effectively  with  such  companies.
Additionally,  the market for vision care is becoming increasingly  competitive.
The Company's  participating  providers  may compete with many other  providers.
Competition is based on many factors including marketing and financial strength,
public  image and the strength of  established  relationships  in the  industry.
There  can be no  assurance  that  the  Company's  participating  providers  can
successfully   compete  in  their   respective   markets.   

Insurance Regulation.  Federal and state laws regulate insurance companies, HMOs
and  other   managed  care   organizations.   Many  states  also   regulate  the
establishment  and  operation of networks of health care  providers.  Generally,
these laws do not apply to the hiring and  contracting  of  physicians  by other
health care  providers.  There can be no assurance that regulators in the states
in which the Company operates would not apply these laws to require licensure of
the  Company's  health  care  operations  as an HMO,  an  insurer  or a provider
network.  The Company  believes that it is in compliance  with these laws in the
states in which it presently does  business,  but there can be no assurance that
interpretations  of these laws by the regulatory  authorities in these states or
in the states in which the Company may expand its managed  care  operations,  or
that if licensing is required, that the Company could complete such licensing in
a timely  manner.  In  addition,  there can be no assurance  that the  Company's
strategy  to expand its  managed  vision  care  business  will not subject it to
regulation in other states.

Dependence  on Major  Customer.  Blue Cross and Blue Shield of Maryland  (BC/BS)
accounted  for 44.4% and 49.1% of the  revenues  of the  Company's  health  care
services  segment during the year ended 1996 and the nine months ended September
30,  1997,  respectively.  Such  revenues  represented  22.5%  and  26.4% of the
Company's consolidated revenues during such 1996 and 1997 periods, respectively.
A  termination  of or  failure  to renew the  agreements  between  BC/BS and the
Company  could  have a  material  adverse  effect on the  Company's  results  of
operations and financial condition.
<PAGE>

Technology-Related Uncertainties
--------------------------------

Uncertainty Concerning Patents. Should LaserSight  Technologies' lasers be found
to infringe upon any valid and enforceable patents in international  markets, or
by Pillar  Point  Partners  in the U.S.,  then  LaserSight  Technologies  may be
required to license  such  technology  from them.  Should such  licenses  not be
obtained,  LaserSight  Technologies  might be prohibited from  manufacturing  or
marketing its PRK-UV lasers in these countries where patents are in effect.

New  Products.  There can be no assurance  that the Company will not  experience
difficulties   that  could   delay  or  prevent  the   successful   development,
introduction  and marketing of its new LaserScan LSX excimer laser and other new
products and  enhancements,  or that its new products and  enhancements  will be
accepted in the marketplace,  including the disposable keratome product licensed
in  September  1997.  As is  typical  in the  case of new and  rapidly  evolving
industries,  demand and market acceptance for recently introduced technology and
products are subject to a high level of uncertainty. In addition,  announcements
of currently planned or other new product offerings may cause customers to defer
purchasing existing Company products.

Potential Product Liability Claims; Limited Insurance.  As a producer of medical
devices,  the Company may face liability for damages to users of such devices in
the event of product failure. The testing and use of human care products entails
an inherent risk of negligence or other action. An award of damages in excess of
the Company's  insurance  coverage  could have a material  adverse effect on the
Company's  business,  financial  condition and results of operations.  While the
Company maintains product  liability  insurance,  there can be no assurance that
any such liability of the Company will be included within its insurance coverage
or that  damages  will not  exceed  the limits of its  coverage.  The  Company's
current insurance coverage limitation is $6,000,000,  including up to $5,000,000
of coverage under an excess liability policy effective July 1, 1997.


<PAGE>

                           PART II - OTHER INFORMATION

ITEM 1   LEGAL PROCEEDINGS

         Pillar Point Partners
         ---------------------

         On March 25, 1997,  the Company  entered into an agreement  with Pillar
         Point Partners and each co-plaintiff to resolve this litigation.  Under
         the agreement,  Pillar Point Partners and each  co-plaintiff  granted a
         release from  liability  under any of their  patents for certain of the
         Company's  ultraviolet laser corneal surgery systems and any service or
         procedure  performed with such systems before the effective date of the
         agreement.  The Company  paid a nominal fee in April 1997 and agreed to
         notify Pillar Point Partners and the  co-plaintiffs  before  LaserSight
         begins manufacturing or selling in the United States in the future. The
         action was dismissed  without  prejudice in the United States  District
         Court for the District of Delaware on March 26, 1997.

         VISX
         ----

         On May 27,  1997,  the Company  entered into a License  Agreement  with
         VISX,  Incorporated  to settle this  litigation  as well as any and all
         potential claims related to patent  infringement  prior to May 1, 1997.
         The  agreement  calls for an  aggregate of $230,400 to be paid in eight
         quarterly installments of $28,800 each.

         Euro Pacific Securities Services
         --------------------------------

         To collect a  $1,140,000  stock  subscription  receivable,  the Company
         initiated a lawsuit that is presently  pending before the United States
         District Court for the Middle District of  Florida-Orlando  Division in
         June 1996 against Euro Pacific  Securities  Services GMBH & Co., KG and
         Wolf Wiese (the  "defendants").  In July 1997,  after failing to timely
         file a  counterclaim,  the defendants  filed a separate  lawsuit in the
         same court against the Company and its  LaserSight  Technologies,  Inc.
         subsidiary,  without obtaining leave from the court, claiming breach of
         contract,  coercion to enter a contract,  misrepresentation,  and other
         charges and seeking an  unspecified  amount of  monetary  damages.  The
         Company  believes that the charges are without  merit and  procedurally
         flawed.  A motion for summary  judgment is  currently  on file with the
         court, but has not been acted upon.

         Northern New Jersey Eye Institute
         ---------------------------------

         In   October    1997,    the    Company    received   a   request   for
         mediation/arbitration  from  Northern  New Jersey Eye  Institute,  P.A.
         (NNJEI) which relates to the services  agreement between LSIA (a wholly
         owned subsidiary of the Company) and NNJEI. This services agreement was
         entered  into as part of the  Company's  July 1996  acquisition  of the
         assets of NNJEI.  The request for mediation  alleges breach of contract
         and fraud which the Company  denies and intends to  vigorously  defend.
         The  mediation is scheduled  for  mid-November  and will be followed by
         binding arbitration if a resolution cannot be reached.
<PAGE>

ITEM 2   CHANGES IN SECURITIES

         a)  As previously  reported,  the Company completed a private placement
             of its Series B Preferred  Stock on August 29,  1997.  Although the
             holders of the Series B  Preferred  Stock have  voting  rights only
             under the limited circumstances  required by Delaware corporate law
             and are not entitled to receive any dividends  unless dividends are
             concurrently  paid on the  Common  Stock,  there is no limit on the
             number of shares which the holders of the Series B Preferred  Stock
             would be entitled to receive upon the conversions thereof,  subject
             to the approval of the  Company's  shareholders  of the issuance of
             more than 1,995,532  shares of Common Stock in connection with such
             conversions.  In  addition,  in the event of a  liquidation  of the
             Company,  the  holders of the  Series B  Preferred  Stock  would be
             entitled to receive  distributions  in preference to the holders of
             the Common  Stock.  See Note 6 of Notes to  Condensed  Consolidated
             Financial Statements.

         b)  Not applicable.

         c)  During the third quarter ended  September 30, 1997, the Company has
             sold or issued the following unregistered securities:

             (1) In July 1997, the Company issued 535,515 shares of Common Stock
             to Frederic B. Kremer as partial  consideration  for acquisition of
             PMA application.  For further  information,  see Note 7 of Notes to
             Condensed Consolidated Financial Statements.

             (2) In August 1997, the Company granted investors and the placement
             agent  warrants to purchase  790,000  shares of Common  Stock.  The
             warrants are exerciseable at a price of $5.91 per share at any time
             during the next five years.

             The  issuance and sale of all such shares was intended to be exempt
             from registration and prospectus  delivery  requirements  under the
             Securities Act of 1933, as amended (the "Securities Act") by virtue
             of Section 4(2) thereof due to, among other thing,  (i) the limited
             number  of  persons  to whom  the  shares  were  issued,  (ii)  the
             distribution  of disclosure  documents to all investors,  (iii) the
             fact  that  each  such  person  represented  and  warranted  to the
             Company,  among other  things,  that such person was  acquiring the
             shares  for  investment  only and not with a view to the  resale or
             distribution   thereof,   and  (iv)  the  fact  that   certificates
             representing  the shares  were  issued  with a legend to the effect
             that such shares had not been  registered  under the Securities Act
             or any state  securities  laws and could not be sold or transferred
             in the absence of such registration or an exemption therefrom.

ITEM 3   DEFAULTS UPON SENIOR SECURITIES

         Not applicable.

ITEM 4   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         Not applicable.
<PAGE>

ITEM 5   OTHER INFORMATION

         Not applicable.

ITEM 6   EXHIBITS AND REPORTS ON FORM 8-K

         a) Exhibits

                                  EXHIBIT INDEX
                                  -------------

Exhibit 2 -  Plans of Acquisition, Reorganization

 2.1     See  Exhibits  10.1, 10.6, 10.13, 10.17, 10.20, 10.21, 10.26, 10.35 and
         10.36.

Exhibit 3 - Articles of Incorporation and Bylaws

 3.1     Certificate  of  Incorporation,  as amended  (filed as Exhibit 1 to the
         Company's Form 8-A/A filed on September 29, 1997*).

 3.2     Bylaws,  as amended  (filed as Exhibit 3 to the Company's Form 10-K for
         the year ended December 31, 1992*).

Exhibit 4  -  Instruments Defining the Rights of Security Holders

 4.1     See Exhibits 3.1 and 3.2.

Exhibit 10 - Material Contracts

10.1     Agreement  for  Purchase  and  Sale of Stock  by and  among  LaserSight
         Centers  Incorporated,  its  stockholders  and LaserSight  Incorporated
         dated January 15, 1993 (filed as Exhibit 2 to the Company's  Form 8-K/A
         filed on January 25, 1993*).

10.2     Amendment  to  Agreement  for  Purchase  and Sale of Stock by and among
         LaserSight  Centers  Incorporated,  its  stockholders,  and  LaserSight
         Incorporated  dated April 5, 1993 (filed as Exhibit 2 to the  Company's
         Form 8-K/A filed on April 19, 1993*).

10.3     Royalty Agreement by and between  LaserSight  Centers  Incorporated and
         LaserSight  Partners  dated  January 15, 1993 (filed as Exhibit 10.5 to
         the Company's Form 10-K for the year ended December 31, 1995*).

10.4     Exchange  Agreement dated January 25, 1993 between  LaserSight  Centers
         Incorporated and Laser Partners (filed as Exhibit 10.6 to the Company's
         Form 10-K for the year ended December 31, 1995*).

10.5     Stipulation  and Agreement of Compromise,  Settlement and Release dated
         April 18, 1995 among James Gossin, Francis E. O'Donnell, Jr., J.T. Lin,
         Wen S. Dai,  Emanuela  Dobrin-Charlton,  C.H. Huang, W. Douglas Hajjar,
         and  LaserSight  Incorporated  (filed as Exhibit 10.7 to the  Company's
         Form 10-K for the year ended December 31, 1995*).
<PAGE>

10.6     Agreement for Purchase and Sale of Stock dated December 31, 1993, among
         LaserSight  Incorporated,  MRF,  Inc.,  and Michael R. Farris (filed as
         Exhibit 2 to the Company's Form 8-K filed on December 31, 1993*).

10.7     First  Amendment  to  Agreement  for  Purchase and Sale of Stock by and
         among MRF, Inc.,  Michael R. Farris and LaserSight  Incorporated  dated
         December 28, 1995 (filed as Exhibit 10.9 to the Company's Form 10-K for
         the year ended December 31, 1995*).

10.8     Technology  Transfer  Agreement dated July 25, 1995 between  LaserSight
         Technologies,  Inc.,  J.T. Lin, Ph.D. and Photon Data,  Inc.  (filed as
         Exhibit 10.4 to the Company's Form 10-Q for the quarter ended September
         30, 1995*).

10.9     LaserSight  Incorporated  1995 Stock Option Plan (filed as Exhibit 10.5
         to the Company's Form 10-Q for the quarter ended September 30, 1995*).

10.10    Modified Promissory Note between LaserSight  Incorporated,  EuroPacific
         Securities  Services,  GmbH and Co. KG and Wolf Wiese (filed as Exhibit
         10.6 to the  Company's  Form 10-Q for the quarter  ended  September 30,
         1995*).

10.11    Employment Agreement by and between LaserSight Incorporated and Michael
         R.  Farris  dated  December  28,  1995  (filed as Exhibit  10.17 to the
         Company's Form 10-K for the year ended December 31, 1995*).

10.12    Employment  Agreement  dated  December  1995 by and between  LaserSight
         Incorporated and David Pieroni (filed as Exhibit 10.18 to the Company's
         Form 10-K for the year ended December 31, 1995*).

10.13    Agreement and Plan of Merger by and among LaserSight Incorporated,  MEC
         Health Care,  Inc.,  Dr. Mark B. Gordon,  O.D. and Dr. Howard M. Levin,
         O.D.,  dated August 28, 1995 as amended as of October 5, 1995 (filed as
         Exhibit 2 to the Company's Form 8-K filed on October 19, 1995*).

10.14    Patent License Agreement dated December 21, 1995 by and between Francis
         E. O'Donnell,  Jr. and LaserSight Centers, Inc. (filed as Exhibit 10.21
         to the Company's Form 10-K for the year ended December 31, 1995*).

10.15    LaserSight  Incorporated 1996 Equity Incentive Plan (filed as Exhibit A
         to the Company's definitive proxy statement dated April 30, 1996*).

10.16    LaserSight  Incorporated  Amended and Restated  Non-Employee  Directors
         Stock Option Plan (filed as Exhibit B to the Company's definitive proxy
         statement dated May 19, 1997*).

10.17    Agreement  and Plan of Merger  dated  April 18,  1996 among  LaserSight
         Incorporated,  Eye Diagnostics & Surgery, P.A., LSI Acquisition,  Inc.,
         John W. Norris, M.D. and Bernard Spier, M.D. (filed as Exhibit 2 (i) to
         the Company's Form 8-K dated July 18, 1996*).

10.18    Amendment  to the  Agreement  and Plan of Merger  dated  June 17,  1996
         (filed as  Exhibit  2 (ii) to the  Company's  Form 8-K  dated  July 18,
         1996*).
<PAGE>

10.19    Second Amendment to the Agreement and Plan of Merger dated July 3, 1996
         (filed as  Exhibit  2 (iii) to the  Company's  Form 8-K dated  July 18,
         1996*).

10.20    Agreement  and Plan of Merger  dated  June 17,  1996  among  LaserSight
         Incorporated,  LaserSight Acquisition, Inc., Cataract Hotline, Inc. and
         Michael R. Norris  (filed as Exhibit 2 (iv) to the  Company's  Form 8-K
         dated July 18, 1996*).

10.21    Asset  Purchase  Agreement  dated  April 18,  1996  between  LaserSight
         Incorporated  and John W. Norris,  M.D. (filed as Exhibit 2 (vi) to the
         Company's Form 8-K dated July 18, 1996*).

10.22    Amendment  to Asset  Purchase  Agreement  dated June 17, 1996 (filed as
         Exhibit 2 (vii) to the Company's Form 8-K dated July 18, 1996*).

10.23    Agreement  dated January 8, 1997 to amend  Agreement and Plan of Merger
         by and among LaserSight  Incorporated,  Mark B. Gordon, O.D. and Howard
         M. Levin,  O.D.  (filed as Exhibit 10.34 to the Company's Form 10-K for
         the year ended December 31, 1996*).

10.24    Agreement  dated  September  18,  1996  between  David T.  Pieroni  and
         LaserSight  Incorporated  (filed as Exhibit 10.35 to the Company's Form
         10-K for the year ended December 31, 1996*).

10.25    Agreement  dated December 17, 1996 between  Public Company  Publishing,
         Inc.,  Samuel S. Duffey and LaserSight  Incorporated  (filed as Exhibit
         10.36  to the  Company's  Form  10-K for the year  ended  December  31,
         1996*).

10.26    Agreement  dated  January  1,  1997,  between  International   Business
         Machines  Corporation  and  LaserSight  Incorporated  (filed as Exhibit
         10.37  to the  Company's  Form  10-K for the year  ended  December  31,
         1996*).

10.27    Addendum  dated  March  7,  1997  to  Agreement  between  International
         Business  Machines  Corporation and LaserSight  Incorporated  (filed as
         Exhibit  10.38 to the Company's  Form 10-K for the year ended  December
         31, 1996*).

10.28    Second  Amendment  to  Agreement  for Purchase and Sale of Stock by and
         among LaserSight Centers Incorporated,  its stockholders and LaserSight
         Incorporated  dated  March  14,  1997  (filed  as  Exhibit  99.1 to the
         Company's Form 8-K filed on March 27, 1997*).

10.29    Amendment  to  Royalty  Agreement  by and  between  LaserSight  Centers
         Incorporated,  Laser Partners and LaserSight  Incorporated  dated March
         14,  1997  (filed as Exhibit  99.2 to the  Company's  Form 8-K filed on
         March 27, 1997*).

10.30    Employment Agreement dated September 16, 1996 by and between LaserSight
         Incorporated  and Richard L.  Stensrud  (filed as Exhibit  10.41 to the
         Company's Form 10-Q filed on May 9, 1997*).
<PAGE>

10.31    Loan  and  Security  Agreement  dated  March  31,  1997 by and  between
         LaserSight  Incorporated  and certain of its  subsidiaries and Foothill
         Capital  Corporation (filed as Exhibit 10.42 to the Company's Form 10-Q
         filed on August 14, 1997*).

10.32    Consent and Amendment  Number One to Loan and Security  Agreement dated
         July 28,  1997 by and  between  LaserSight  Incorporated  and  Foothill
         Capital  Corporation (filed as Exhibit 10.43 to the Company's Form 10-Q
         filed on August 14, 1997*).

10.33    Warrant to purchase 500,000 shares of Common Stock dated March 31, 1997
         by and between LaserSight Incorporated and Foothill Capital Corporation
         (filed as Exhibit 10.44 to the Company's  Form 10-Q filed on August 14,
         1997*).

10.34    License Agreement dated May 20, 1997 by and between VISX,  Incorporated
         and  LaserSight  Incorporated  (filed as Exhibit 10.45 to the Company's
         Form 10-Q filed on August 14, 1997*).

10.35    Patent Purchase Agreement dated July 15, 1997 by and between LaserSight
         Incorporated  and Frederic B. Kremer,  M.D.  (filed as Exhibit 2.(i) to
         the Company's Form 8-K filed on August 13, 1997*).

10.36    Agreement  and  Plan  of  Merger  dated  July  15,  1997  by and  among
         LaserSight  Incorporated,  Photomed Acquisition,  Inc., Photomed, Inc.,
         Frederic B. Kremer,  M.D., Linda Kremer,  Robert Sataloff,  Trustee for
         Alan Stewart Kremer and Robert  Sataloff,  Trustee for Mark Adam Kremer
         (filed as Exhibit  2.(ii) to the Company's Form 8-K filed on August 13,
         1997*).

10.37    Securities  Purchase  Agreement  dated  August 29,  1997 by and between
         LaserSight   Incorporated   and  purchasers  of  Series  B  Convertible
         Participating Preferred Stock of LaserSight Incorporated.

10.38    Registration  Rights  Agreement  dated  August 29,  1997 by and between
         LaserSight   Incorporated   and  purchasers  of  Series  B  Convertible
         Participating Preferred Stock of LaserSight Incorporated.

10.39    Warrant to purchase  750,000  shares of Common  Stock dated  August 29,
         1997 by and between LaserSight  Incorporated and purchasers of Series B
         Convertible Participating Preferred Stock of LaserSight Incorporated.

10.40    Consent and Amendment  Number Two to Loan and Security  Agreement dated
         August 29, 1997 by and between  LaserSight  Incorporated  and  Foothill
         Capital Corporation.

10.41    Consent and Amendment Number Three to Loan and Security Agreement dated
         September 10, 1997 by and between LaserSight  Incorporated and Foothill
         Capital Corporation.

10.42    Independent  Contractor Agreement by and between Byron Santos, M.D. and
         LaserSight Technologies, Inc.


----------------------
*Incorporated herein by reference.  File No. 0-19671.

<PAGE>

Exhibit 11      Statement of Computation of Per Share Earnings

Exhibit 27      Financial Data Schedule

                b)  Reports on Form 8-K

                On July 1, 1997, the Company filed with the Commission a Current
                Report  on Form  8-K  regarding  conversion  of the  last of the
                Series A Convertible  Preferred Stock and a press release issued
                by the Company  dated July 1, 1997,  regarding  an update on the
                patent purchase agreement with IBM.

                On July 31,  1997,  the  Company  filed  with the  Commission  a
                Current Report on Form 8-K regarding the press release issued by
                the  Company  dated July 31,  1997,  regarding  an update on the
                patent purchase agreement with IBM.

                On August 13,  1997,  the Company  filed with the  Commission  a
                Current  Report on Form 8-K  regarding  the  acquisition  of the
                rights to a Pre-Market  Approval  application  with the Food and
                Drug Administration for a laser dedicated to perform LASIK and a
                keratome patent.

                On September 2, 1997,  the Company  filed with the  Commission a
                Current Report on Form 8-K regarding the press release issued by
                the Company dated  September 2, 1997,  announcing  completion of
                the patent acquisitions from IBM.

                On September 11, 1997,  the Company filed with the  Commission a
                Current Report on Form 8-K regarding the press release issued by
                the Company dated September 9, 1997,  announcing that LaserSight
                acquired a license and the rights to a disposable keratome.

                On September 15, 1997,  the Company filed with the  Commission a
                Current  Report on Form 8-K regarding the purchase of the patent
                portfolio from IBM on August 29, 1997.

                On September 24, 1997,  the Company filed with the  Commission a
                Current Report on Form 8-K regarding the press release issued by
                the Company dated September 23, 1997, announcing that LaserSight
                received  $4  million  for an  exclusive  license  covering  the
                vascular  and  cardiovascular  rights  included  in the  patents
                purchased from IBM.


<PAGE>



                                   SIGNATURES


         Pursuant to the  requirements  of the Securities  Exchange Act of 1934,
the  undersigned  have duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.


                                               LaserSight Incorporated




Dated:     November 14, 1997                   By: /s/ Michael R. Farris
     ----------------------------                 --------------------------
                                                   Michael R. Farris,
                                                   Chief Executive Officer



Dated:     November 14, 1997                   By: /s/ Gregory L. Wilson
     ----------------------------                 --------------------------
                                                   Gregory L. Wilson,
                                                   Chief Financial Officer